It's time to move beyond worn-out rhetoric about taxes and spending and debate Oregon's unique kicker law in a meaningful way. Oregonians learned last week that, due to a stronger-than-expected economy, the kicker will pay individual Oregon taxpayers a total of nearly $900 million next year and corporations $200 million. State law requires that the state refund money to taxpayers if revenues are more than 2 percent above projections for a given biennium. In this case, a strong economy is bringing in about $1.1 billion more than what lawmakers thought they had to work with when they adopted the budget for the 2005-07 biennium.
That piece of news quickly reignited the same debate citizens have heard for the past decade or more. Democrats want the state to keep the excess money rather then refund it to taxpayers. Republicans say hands off Ñ it's the taxpayers' dollars.
Without question, it's the taxpayers' money, but that doesn't mean citizens might not want to consider spending some or all of it in appropriate ways. At the same time, no one from the governor on down should presume Oregonians are willing to hand over their kicker checks without compelling reasons that achieve specific, measurable results.
Any proposal must be specific
Gov. Ted Kulongoski, a Democrat, was among the first to react last week to the latest kicker news. He said he would ask the 2007 Legislature to suspend the kicker until 2011 and use the money for education, health care and development of alternative fuels. Kulongoski's idea drew immediate reaction from Republican House Speaker Karen Minnis, who flatly said she would oppose any effort for the state to keep the personal kicker.
It's easy for politicians to exploit the kicker because the topic so clearly reveals the tax divide between Democrats and Republicans. But we don't believe the public views this matter in such black-and-white terms. What citizens want to know is what they are getting for their money. And if the results aren't relevant and quantifiable, they'd rather get the money back and decide for themselves how they want to spend their tax refunds.
Kulongoski won't get far with his idea of suspending the kicker unless he is able to give Oregonians more specifics. Perhaps education does need more money. The governor must spell out precisely how he would use the funds and how citizens would benefit.
Take a look at corporate kicker
Altering the kicker law would be no easy task. The kicker was enacted in 1979 and enshrined in the state constitution in 2000. It can be waived for a budget cycle only with a two-thirds vote of the Legislature. Although the bulk of the projected kicker Ñ an estimated $883 million Ñ will go to individual taxpayers, another $200 million would be returned to corporations. Most of that money would be sent out of state. Interestingly enough, even Republicans are open to discussing elimination of the corporate kicker.
But we think that should happen only if the money is directed toward causes that are of importance to the business community and public at large, such as the creation of a state rainy-day fund that would help Oregon during economic downturns, as suggested by Kulongoski. Business leaders also ought to be open to using corporate-kicker dollars for worker training, since finding a skilled labor force is one of the biggest problems facing Oregon businesses.
Any change to the kicker will require either overwhelming legislative support, or at least enough support to refer a proposal to voters. We doubt that even the best-constructed plan will have much chance with voters in today's anti-tax environment. And if anyone believes the kicker could be suspended without an exact accounting of the benefits to Oregonians, they are just plain dreaming.